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By Pete Moore On January 6th, 2012

Daily Telegraph: US jobless rate falls to three-year low as 200,000 Americans find jobs

“America’s unemployment rate dropped to its lowest level in almost three years in December, as the world’s biggest economy created far more jobs than expected.”

You have to love that “as the world’s biggest economy created far more jobs than expected.” Far more than expected by the Keynesians and other PhDs who have no idea how the money supply affects and distorts an economy. These are the experts who spent the first half of 2011 confidently predicting a double-dip recession for the second half of 2011. Regular readers will know that someone, somewhere (modesty forbids) knew there would be no recession and that he said so. Continues the Telegraph:

“The better-than-expected figure will raise hopes that 2012 may be the year in which US growth emerges from the stop-start pattern that has characterised the last two years.”

Only if Bernanke continues to pour inflated dollars into the economy. The key to these job figures is that his money printing ran at 14% annualised from May to November 2011. This is the source of the illusory growth which experts are now viewing as a recovery. It’s nothing more than a sugar rush, an artifical, inflationary boost which always ends in contraction. These extra dollars will continue to fuel price inflation throughout 2012 until even Bernanke can ignore the increasing cost of living no more.

When even he sees that and turns off the tap it’ll be back to recession.


  1. your insane, there are 40 million americans unemployed or underemployed to just keep up with population and graduation rates to equal a zero loss the US jobs market has to grow 150,000 a month. wooop dee dooo it grew 200,000 in december the one month out of the year that ALL retailers hire christmas help which is usually a 400,000 gain month.

    I’m sure you will be SHOCKED when January shows a record growth in unemployment when all the temporary help gets layed off

    they lowered the unemployment rate last month by eliminating 2.5 million jobs from the count. you watch they’ll have the unemployment rate down to 7.9 by sept yet no more people will have jobs

    your smokin crack

  2. Troll –

    Do you think I’m saying the American economy is on the mend?

  3. sorry yes on re-read I stand by my view but I see you do to.

  4. They are all printing money now: the Fed and the Bank of England openly and the ECB sneakily.

    This is mainly to “kickstart” growth, but almost as important is currency devaluation. This is the equivalent of the tarriffs of the 1930s – competitive devaluation. It has worked well for China for 20 years, but the game is up for them now – the rest are at it just as aggressively. A trade war is guaranteed.

  5. “These extra dollars will continue to fuel price inflation throughout 2012 until even Bernanke can ignore the increasing cost of living no more.”

    I wonder why you neglected to include any numbers on this price inflation that is continuing? Or perhaps a graph so we can see how well it lines up with all this ‘money printing’?

    Because I am pretty sure you’ve been claiming that hyperinflation is just around the corner for yonks now. It always seems we have to give it just another Friedman Unit.

  6. Frank O’Dwyer –

    I neglect to include numbers or a graph because the entirety of price inflation cannot be captured adequately in a short post. It’s not just new money going into the economy, it’s where it goes. For example, stock markets have held up pretty well given the economic times. This is because some new money goes into bidding up stocks. In the week before Christmas giants such as Wal-Mart, Pfizer, Verizon, McDonald’s, Home Depot and Starbucks all reported 52-week highs. This is because because business is reckoned to be good sales are up. It also suggests these firms will be stronger bidders at the commodity and wholesale level , pushing commodity and wholesale prices higher, which will then in loop back fashion result in their raising consumer prices.

    Commodities have done well as new money flows into these real, tangible assets.

    Treasury yields are holding relatively low against the chronic state of national debts. This is duw in great part again because some new money is bidding up prices.

    I have warned against the threat of hyperinflation. That price inflation results from increasing money supplies is standard and unarguable. Even Keynesians recognise it. However, although hyperinflation has its source in chronic money creation, in itself it is a political phenomenon because it is a loss of confidence in the currency, the triggers for which are intangible and varied.

    There is no mechanism which allows anyone to say “we can print this much and then money hyperinflation begins”. It will happen if you print enough, but the actual triggers for hyperinflation are social and political triggers.